Saturday, August 28, 2010

If You Were a Philanthropist

Imagine, having achieved a degree of financial comfort, that you resolve to help others. After reflecting on what made a difference in your life, you decide to help young adults in your area launch their careers. You seek the counsel of wise and trustworthy advisors and, from their recommendations, put together a list of talented, motivated young people who are in need of support. After interviewing some wonderful candidates, you make the wrenching decision to provide significant support to two of them, rather than modest support to several of them.

Seth and Sarah, the two you have chosen, say the best way you can help them is to buy them a car. They make a similar case: a car will give them access to people and places that they would not otherwise have, allow them to focus the majority of their time on building their careers and, yes, make a positive impression as a young rising professional. You write a generous check to both of them in the same amount and tell them that they are free to buy whatever car they choose or, indeed, to use the money any way they would like. Seth spends every cent on a luxury car while Sarah buys a nice but practical vehicle, spending less than the full amount that you have given her.

Seth, whose career gets off to a roaring start, tells you that the quality of the car made all the difference. Like it or not, he says, you have to look a certain way for others to believe in you and his luxury car has allowed him to create the appearance of success which, in turn, proved invaluable in attracting a small number of very high end clients. Sarah tells you about where her car has taken her in developing a solid business base and begins to imagine where it might take her in the future. You are pleased with progress both are making, albeit in different ways, and make it clear that you are willing to consider additional support.

Seth says he needs additional support to keep his luxury car finely tuned, to keep up with the expensive repairs, to add a GPS system, and pay for the rising cost of fuel. Sarah says she could use money to extend her service area and shares with you her research which shows which new markets are within her reach. You provide additional support to both, giving more to Seth because his business has achieved such prominence in such a short time while recognizing that Sarah’s plan is sensible and full of promise.

This pattern persists for some time. Each time you consider a new investment, Seth always makes a case for the state of the vehicle and the rising cost of fuel while Sarah seeks additional investment to extend services to more and more clients. After awhile, you find yourself reassessing your priorities. As impressed as you have been with Seth, you find yourself growing frustrated with his endless insistence that more and more is needed to keep the increasingly expensive vehicle in optimal running condition and to keep up appearances lest he fall out of a select social group. Sarah, meanwhile, has treated her car as means of reaching more clients, not an end unto itself.

Then misfortune falls. The stock market collapses and your net worth is cut in half. You are determined to continue to help others, but at half your previous level you. And you apply the same principle as before; it is better to provide significant support to one rather than modest support to both. Seth doesn’t change his argument. Sarah says she’s trading in car to buy a smaller, more fuel-efficient one that will allow her to spend more of the capital available on delivering a higher level of service to her clients. Which one do you choose to support?

When I review the cases of support from various schools and non profits, I see too many Seths and too few Sarahs, too many asking for support to keep the enterprise in fine fettle, or so that it can remain competitive with peers, or just to keep it running as it always has, and too few explaining exactly where they are going and how they propose use private dollars to make difference in the lives of those they serve. I see too many asking for support on the basis of increased costs and too few detailing how they have cut costs to ensure that new philanthropic dollars add value to delivery of service to those most in need or those who stand the benefit the most.

Times have changed. New realities have been visited upon us. Philanthropy-seeking organizations will have to adjust. In making their case for support, they would be wise to put themselves in the philanthropists’ position and ask what they would do if they had to make had to decide between Seth and Sarah.

P.S. My thoughts on reviving lagging campaigns are featured in the latest Academic Impressions newsletter, at:

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